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Stock Market Today: Dow in bruising nearly 400-point slump as Q2 wobble continues

Published 04/02/2024, 06:55 AM
Updated 04/02/2024, 04:14 PM
© Reuters.

Investing.com -- The Dow slumped Tuesday, extending its poor start to the second-quarter, pressured by health care stocks and another big jump in Treasury yields amid remarks from several Federal Reserve officials reiterating the need to keep rates higher for longer.

By 16:00 ET (20:00 GMT), the Dow Jones Industrial Average was down 396 points, or 1%, S&P 500 fell 0.7%, lower and NASDAQ Composite dropped 220 points, or 1%.

Treasury yields continue climb as Fed speakers signal higher for longer

Treasury yields added to gains from a day earlier as the recent bout of stronger economic data and Fed speakers cooling expectations for early-rate expectations muddied the path for sooner rate cuts. 

San Francisco Fed President Mary Daly echoed said Tuesday that there was no urgency to cut rates as as inflation is still above the central bank's 2% target. Daly's echoed Cleveland Fed President Loretta Mester, who said she sees the fed cutting rates this year, but flagged pivoting to cuts too early rather than keeping them higher for longer was the bigger risk.

The CME's FedWatch tool now factors in around 62% odds of a Fed rate cut in June, down from about 70% probability a week ago.

The remarks arrived on the heels of data showing job openings rose 8.756M in February, from 8.748M in January, though just shy of expectations for 8.760M. 

Jobs data will continue to be in focus, with the payrolls report for March slated to be released on Friday. 

The U.S. economy is expected to have added 205,000 jobs in March, slowing from the 275,000 jobs added in February, amid hopes that the economy is set for a "soft landing", in which inflation moderates but the economy avoids a severe downturn.

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Healthcare stocks suffer losses

Health care stocks including Humana Inc (NYSE:HUM), UnitedHealth Group Incorporated (NYSE:UNH) and CVS Health Corp (NYSE:CVS) were down sharply to lead losses in the broader market after the Center for Medicare and Medicaid Services private Medicare Advantage rates will increase an average 3.7% from 2024.

The rate was unchanged from the initial proposals in January, signaling the insurers’ margins will remain under pressure next year. That took Wall Street by surprise as only once in the past 10 years have final rates not increased from the initial proposals, according to research from JPMorgan. 

Tesla leads slump in EV stocks after Q1 deliveries disappoint

Tesla (NASDAQ:TSLA) stock fell 5% after the electric vehicle manufacturer reported its first-quarter delivery numbers, falling well short of the expectations. 

The EV giant delivered 386,810 vehicles against the estimated 449,080, according to Bloomberg consensus.

This miss was an "unmitigated disaster," Wedbush said in a note, and marked "a seminal moment in the Tesla story for Musk to either turn this around ... otherwise, some darker days could clearly be ahead that could disrupt the long-term Tesla narrative."

Competitor Rivian Automotive (NASDAQ:RIVN) stock also fell 5% after the EV company trailed analyst consensus for first-quarter production numbers.

Other EV stocks including Nio Inc Class A ADR (NYSE:NIO), Nikola Corp (NASDAQ:NKLA) were also in the red.

PVH slumps on softer guidance; Schlumberger in deal action

Schlumberger NV (NYSE:SLB) said it struck a deal to acquire oilfield equipment maker ChampionX Corp (NASDAQ:CHX) for $7.7B in an all-stock deal, sending shares of the latter up 10%. 

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Elsewhere, PVH (NYSE:PVH) stock slumped over 22% after the fashion retailer, which owns the Tommy Hilfiger and Calvin Klein brands, provided disappointing full-year sales guidance, citing a difficult macroeconomic backdrop, particularly in Europe.

(Peter Nurse contributed to this story.)

Latest comments

OMG, yes Q2 has been so "wobbly", all 2 trading days have been so crazy.
I'm sure stocks are just 'taking a breather', right? More rate hopes to come, right?
Gold up against strong dollar and high Treasury yields. Almost like somebody doesn't believe it's going to work out so well anymore. That somebody will be everybody soon. The Government and the Fed are a joke and the game is over. Also Iran / Israel .
The US Ponzi Scheme once again demonstrates why it's the laughingstock of the investing world.
the charging bull statue on wall street is the symbol for americas growth and prosperity. wall street exists as a way for anyone to invest in a company they believe in and the investment gives funding to a company to grow and expand. growth and expansion creates more jobs and opportunity. you can trash talk all you want if you'd rather be the ass of the bull instead of the head of the bull.
Haha. Hooray for conspiracies!
Mitchel is at ir again, with his crazy paranoid statements.
hey they brought back hand smelling guy pic. that's when you know its about to get bad
Uneducated overslept today and didnt manage to start buying during the last hour. Maybe tomorrow.
@dylan: Where's the claim that it is just healthcare stocks? Is this article above your reading level?
Right it is just healthcare stocks that are causing the market to tank. Top tier analysis.
Right...it is just healthcare stocks that are sinking today. How do they manage to make up such ridiculous BS?
Getting Biden out of the WH is the only solution
the solution to what? markets at record highs..?
..or, you being a russian troll, this is about how you can win in Ukraine.. by trump handing it to your evil little dictator on a silver platter...
Why? Just because he's doing is terrific job? I hope he's there another 4 years.
Time for the late trade magic show in the biggest investment JOKE in the world.
winner takes all
i m a j o k e
Again! Twice in one day!
Excuse da jour.
Origin of religions is conspiracy-type people make bvllsh!+ up to explain what they can't explain, and the ruling class co-opt that and steer it toward the rulers' benefits.
"du"
around 1% is neither a sharp fall nor a selloff..
Some people, more so bears than bulls, are too easily triggered by the trivial.
The CME's FedWatch tool now factors in around 67% odds of a Fed rate cut in June, up from about 54% probability a few hours ago. Why the stocks are still falling? Tomorrow? Mitchel's favourite "last hour miracle rebound?"
Stock market has been flattish since market open.
russia is now getting control oil with saudis and USA cant do anything
usa will just make more oil. we were already at 13.2 mbd before. we can make it 14 before November.
We need to completely eliminate fossil fuels, that's what we need to do, not invest in them.
Bullsh.t
"only two options for big firms is long stocks or bonds" -- True for a most of funds. @dylan, you can go check their charters.
putin is very happy
He has a cap of 60 $ per barrel - it doesn't matter for him if 80 or 90 or 190.
Putin is not very happy Russia and Saudi Arabia are losing market share to the United States.
US economy is growing in full throttle and market makers are expecting us to believe that stocks to higher only with rate cuts:) delusional. Keep your stocks!
Market makers ain't expecting that; they don't care.
Soft-landing is not full throttle.
Now that they trapped $2 trillion of retail money in NVDA along with trillions more in other mega-caps with massive P/Es, they can tank the market.
Yep...then they'll say something like $ billions 'wiped out' from the markets as its being transferred into their pockets
They speak of the market as if the only two options for big firms is long stocks or bonds, but they forget that these entities make a fortune shorting the market. They market money off VIX. They look at a stock market that is high PE pumped with retail funds and this is how they can steal it, just pull out their liquidity.
Why not buying heavily beaten down stocks at all time lows? Drop this bs line nvidia.
markets continue to be moving predictably under present market conditions.
Reduced rate cut expectation hahahaha what a sophisticated comment what have changed from last week??! One big fraud, better do not comment this crap at all
then farting stay out of this market if you can't handle the market action.
Very much agree with what you said
And the miracle recovery commences. How much of the loss will magically vanish into thin air by the close this time? Fraudulent, criminally manipulated JOKE.
You're not buying the dip Ac?
No recovery not for a minute since yesterday - you are liar! :)
mmhmm me a mo ron. scratchy scratchy. 'm i talking to myself. i say a whole lotta nothing. i repeat the only thing i think i know.
JOLTS job openings miss. Rate cuts imminent. LOL
And Gold is soaring. Perhaps you'd like to tell us what's really going on in the markets. Looks like savvy investors (and insiders) are selling off and piling into PMs....
It is certainly time for bears...
You need to anticipate a rally tomorrow.
Stock market up a bit since your post @ 11 am. We (honest traders, not insiders) should give up on the idea of certainty.
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